News

Popeye's Q2 results show chain progressing as planned

August 17, 2016

Popeyes Louisiana Kitchen Inc. reported a "productive" second quarter and reaffirmed its guidance after showing that the chain made progress on its three-pronged strategy for the year.

The company said that revenues and net income both grew for the quarter compared with the same period last year. 

"We have continued to offer our guests a balance of exciting new products and value-oriented promotions, and our share of chicken-QSR grew this quarter," said Popeye's CEO Cheryl Bachelder.

"We have successfully implemented our new field visit protocols to advance our operations and we completed the scoping of our One Technology initiative. Our international team is delivering excellent results. So while we are experiencing slower domestic sales, consistent with the sector, we remain highly confident that our bold long term goals are achievable.”

Q2 highlights
For the second quarter, total revenues for the chain grew 3.9 percent year over year to $61.7 million. Reported net income was the same as this quarter last year at $10.3 million, but up three cents per diluted share to 47 cents. Other key measures include: 

• total revenues grew 3.9 percent to $61.7 million;
• both earnings per diluted share and adjusted earnings per diluted share grew 6.8 percent year over year; 
• total system-wide sales grew 6.5 percent due to net unit growth and same-store sales performance, while global same-store sales increased 0.7 percent;
• total domestic same-store sales were flat compared with a 7.9 percent increase last year;
• the chain grew the domestic market share of its category to a record high 26.6 percent;
• international same-store sales grew 6.4 percent, the 26th consecutive quarter of international same-store sales growth;
• company-operated restaurant operating profit dropped by almost one percentage point due to lower new market sales and higher labor costs;
• system-wide, the chain opened 43 restaurants, about half domestic and half international, with 2,594 restaurants globally, or a net unit growth of 6.2 percent over 12 months; and 
• the company repurchased 532,864 shares of common stock for $30 million.

Fiscal 2016 guidance
Based on the above reported performance, the chain decreased its same-store sales growth guidance from 2 to 3 percent to 1 to 2 percent. Popeye's also amended the number of new company-operated openings to two, from its previous estimate of between three and five. All other previous guidance was reiterated.